Nature, Nurture and Income

Some might suggest that parents treat their biological and adopted children differently and this is what accounts for the difference in incomes. The interpretation is very uncharitable to the parents who have volunteered to raise an adopted child and I think it implausible. Moreover, unless every adopted child is treated equally poorly in all families, then we would still expect the income of adoptees to increase with parental income but perhaps starting at a lower level.

The other proviso is that the Holt experiment is only informative for the experimental variation in environment. In other words, we can tell from the Holt experiment that variation in parental income from around 25 thousand to 175 thousand doen’t have much impact on variation in adopted child income but all these children are raised in the United States so culture and other variables are roughly similar. In other words, move a child from a poor country to a rich country and you would expect a much bigger treatment effect than moving a child from a poor family to a rich family.